TRADE POLICY OF FRANCE

An Overview

Presented By:Jay Patel (80)Jude Abreo (81)Ketan Mokal (82)

THE FRENCH REPUBLIC

• France is a member state of the European Union located in its

western region, with several overseas territories and islands located

on other continents.

• 3rd largest in Europe behind Russia and Ukraine.

• 5th largest economy by nominal GDP.

• Most visited country in the world, receiving 82 million foreign

tourists annually. 

• One of the founding members of the European Union.

• It is also a founding member of the United Nations, and a member of

the G8, G20, NATO, OECD, WTO and the Latin Union.

• It is one of the five permanent members of the United Nations

Security Council.

• 3rd largest number of nuclear weapons in the world and the largest

number of nuclear power plants in the European Union.

• Trade policy in France is governed by International

Chamber of Commerce.

Objectives :

• To promote trade and investment.

• Open market for goods and services.

• Free flow of capital.

THE FRENCH REPUBLIC

Trade Policies of France

• France focuses on rebuilding its economy in the

wake of World War I.

• Trade policy is largely protectionist. Exports are

primarily of luxury goods, although poor harvests

hamper wine production.

• With a weakening currency, France cannot afford

many imports

1919-1928

1929-1939

1936-1939

1940-1944

Trade Policies of France

• In the wake of the Depression, France maintains the gold

standard.

• As other currencies decline in value relative to the franc,

French exports become more expensive. Exports fall to

less than two-thirds of imports.

• France abandons the gold standard. A devaluation of the

franc helps increase exports.

• The structure of exports shifts from light toward heavy

industry and agricultural products, sold primarily to

Western and Central Europe.

• The United States supplies imports of raw materials.

France also trades heavily with its colonies, importing

raw materials and exporting manufactured goods.

1919-1929

1929-1939

1939-1949

1949-1959

Trade Policies of France

• Trade collapses under the German occupation and

the Vichy regime.

• Germany requisitions most of France's resources.

Agricultural production is disrupted as young men

go to war and fighting spreads throughout the

country.

• Poor harvests aggravate already low production

on mine-infested agricultural land. France must

import bulky coal, grain, high shipping costs, and

imports rise to five times the level of exports.

Loans finance the trade deficit.

1919-1929

1929-1939

1939-1949

1949-1959

Trade Policies of France

• In 1949, France removes quantitative restrictions on

half of its private trade with other European

countries.

• Reduction in coal shortages and other industrial

bottlenecks enable an increase in exports, which

benefit from specific credits and subsidies.

• The Treaty of Rome establishes the European

Economic Community. Member states establish a

common integrated tariff systems.

• The franc's devaluation helps exports increase

greatly.

1919-1929

1929-1939

1939-1949

1949-1959

Trade Policies of France

• Membership in the EEC and rapid decolonization

change the pattern of trade. The EEC's industrialized

nations provide a large market for France's

agricultural products.

• By 1969, France provides 42 percent of the EEC's

agricultural exports. The government, however,

remains the principal buyer of high-tech products

such as military aircraft, nuclear weapons, and

nuclear power.

1959-1969

1969-1979

1979-1989

1989-1999

Trade Policies of France

• Industrial exports, particularly of cars, chemicals,

pharmaceuticals, and aircraft, rise.

• France also sees an agricultural boom and becomes

the world's second agricultural exporter after the

United States.

• The 1975 Lomé Convention formalizes bilateral

agreements in which European Community countries

extend export concessions to their former colonies.

1959-1969

1969-1979

1979-1989

1989-1999

Trade Policies of France

• France's economic crisis does not spare its trade

sector.

• OPEC's price increases and the overthrow of the

Shah of Iran drastically reduce France's oil imports

from the region.

• France builds up its nuclear power capacity, but still

must import expensive oil from other regions.

1959-1969

1969-1979

1979-1989

1989-1999

Trade Policies of France

• Persistent inflation lowers the value of the franc

against other major currencies and drives up the

price of imports.

• The global economic slowdown leads France to

reduce its imports and thus regain a positive trade

balance.

• The establishment of the European Single Market

brings free movement of people, goods, services,

and capital across Europe and opens up an area of

376 million consumers to French companies.

1959-1969

1969-1979

1979-1989

1989-1999

Trade Policies of France

• France represents 6 percent of world trade. In

general, trade policies are determined by European

Union agreements and practices.

• The government investigates ways to promote

exports more aggressively, especially to markets in

East Asia and Latin America.

• France continues to extend varying preferential

tariff treatment to imports from the African,

Caribbean, and Pacific developing countries.

1999-2009

2009 onwards

Trade Policies of France

• Reducing unemployment and creating jobs depend

in particular on French companies’ ability to win

markets abroad and stand out from their

international competitors.

• Conducive to job creation in France.

• Deal with non-tariff barriers that particularly

penalize French companies.

• Involve strict social and environmental

requirements.

• Involve gradual implementation and adequate

temporary protection measures for the sensitive

sectors of our economy.

1999-2009

2009 onwards

France is one of the EU’s major importers and exporters with everything from raw commodities to automobiles.

Important Contributions (Sectorial)

• 3rd largest trader in the European Union after Germany

and the United Kingdom. 

• 2nd second largest exporter in the world of both services

and farm products.

• The contribution of the agricultural sector to the country’s

GDP is almost 2.5%. Almost 25% of the total agricultural

products of the European Union being produced.

• Manufacturing industry is also a key exporter, contributing

nearly 27% to GDP.

Exports & Imports

Export Goods

• Aircraft

• Plastics

• Chemicals

• Pharmaceutical

• Iron & Steel

• Beverages

• Agricultural Products

• Textiles and Clothing

• Machinery and

Transportation

Equipment.

Import Goods

• Vehicles

• Crude Oil

• Chemicals

• Machinery and

Equipments

Major Export & Import Partners

Exports:According to the CIA World Fact book, France exported US $490 billion worth of goods and services.

• Germany (14.7%)• Spain (9.6%)• UK (8.3%)• US (7.2%)• Belgium (7.1%)

Imports:

French imports stood at US $529.1 billion. Primary imports included cars and vehicles, machinery and equipment, crude oil, plastics, chemicals and aircraft.

• Germany (18.9%) • Belgium (10.7%)• Italy (8.2%)• Spain (7%)• Netherlands (6.5%)• UK (5.9%)• US (5.1%)

References

• http://www.ambafrance-us.org/spip.php?article3858

• http://www.cnccef.org/69-more-about-french-foreign-trade-

advisors-cce-s.htm

• http://www.nationsencyclopedia.com/economies/Europe/

France-INTERNATIONAL-TRADE.html

• http://www.pbs.org/wgbh/commandingheights/lo/

countries/fr/fr_full.html

• https://www.cia.gov/library/publications/the-world-

factbook/geos/countrytemplate_fr.html

• CIA World Fact book.